State University of New York at Stony Brook

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State University of New York
at Stony Brook
Health Information Management
Department - Selected Procurement
and Human Resources Practices

Purpose
To determine if the Health Information Management Department at Stony Brook University
Hospital complied with applicable requirements related to procurement and human resources.
The audit covers the period June 1, 2003 through June 12, 2013.

Background
Stony Brook University Hospital (Hospital), located in Suffolk County, New York, is Long Island’s
premier academic and regional medical center and, with 603 beds, the region’s only tertiary-care
center and level 1 trauma center. As part of Stony Brook University, one of the four University
Centers of the State University of New York (SUNY), the Hospital’s mission is to provide excellence
in patient care, education, research, and community service. In fulfilling its mission, the Hospital is
bound by certain federal, State, and SUNY policies and regulations governing, among other issues,
electronic patient medical records, service procurement, patients’ privacy rights, and hiring and
promotion practices. The Hospital’s Health Information Management Department (Department)
is responsible for the collection, storage, and transmission of patient health records to meet the
Hospital’s legal, professional, ethical, and administrative requirements. Annually, the Department
processes, on average, approximately 132,000 inpatient and outpatient medical records and
archives more than 1.5 million records, accounting for roughly 42,000 cartons of stored materials.
To manage its responsibilities, the Department utilizes both in-house and outsourced staff.

Key Findings

The Department has demonstrated a pattern of non-compliance with applicable requirements
related to procurement and human resources.

SK, Inc. (SK) was awarded a contract for medical records storage services that costs approximately
$955,000 more than the lowest bid. We found inadequate evidence to support the Hospital’s
rejection of the lowest bidder.

The Hospital does not adequately verify contract payments to SK and, therefore, has limited
assurance that such payments are correct. SK was paid about $701,000 for the period April
2010 to December 2012.

The Department has not properly monitored vendor outsourcing of medical record transcription
services to ensure compliance with the “no off-shore outsourcing” contract clause, which is
intended to help safeguard the privacy of patient information.

On multiple occasions the Hospital engaged in hiring and promotion practices that were not in
compliance with requirements. For instance, a Department employee hired at an annual salary
of $43,000 was promoted three months later, and received a $17,000 raise, despite not meeting
the minimum qualifications for the position. Nine months later, she received another raise of
$12,900,

Key Recommendations

Ensure all employees involved in the procurement process adhere to State and SUNY guidelines.

Properly monitor the SK contract to ensure the vendor is paid only for services that are necessary
and actually rendered, and there are no duplicate billings.

Ensure key provisions of the Department’s contracts are properly monitored.

Establish a control environment that cultivates fair and competitive hiring and promotional
practices and complies with the Hospital’s policies such as the Waiver of Recruitment.

Other Related Audits/Reports of Interest

State University of New York: Downstate Medical Center: Allegations of Procurement Fraud,
Waste and Abuse at State University of New York (2010-S-45)
Office for Technology: Procurement and Contracting Practices (2010-S-71)

State Government Accountability Contact Information:Assistant Comptroller: Andrea InmanPhone: (518) 474-3271; Email:StateGovernmentAccountability@osc.state.ny.usAddress: Office of the State Comptroller; Division of State Government Accountability; 110 State Street, 11th Floor; Albany, NY 12236